Interarch Builds Stronger Future: Capacity and Orders Drive Growth

Ashwin Thakker

— 2 min read
  • Sales Growth Outlook: Expects to surpass earlier 17.5% annual growth guidance for the year.
  • Margin Outlook: Anticipates EBITDA margins to improve from Q3 onwards, aiming to exceed last year's EBITDA with a focus on 50-100 basis points improvement.
  • Capacity Expansion: Two new pre-engineered building (PEB) lines (Andhra Pradesh Phase-II, Kichha) are commissioning, boosting total capacity to 200,000 MTPA. A new heavy fabrication unit in Andhra Pradesh is slated for Q2 FY27.
  • Capital Expenditure (CAPEX): Approximately Rs.150 crores CAPEX planned by March next year to add Rs.1,000 crores worth of PEB building capacity and Rs.300 crores for heavy structures.
  • Order Book & Pipeline: Current order book stands at Rs.1,695 crores; short-term pipeline (Pipeline-I) is Rs.2,500 crores, and mid-term (Pipeline-II) is Rs.4,000 crores. Targets an FY26 closing order book of Rs.1,800-1,900 crores.
  • Market Trends: Significant demand observed from new-age industries (semiconductors, EV batteries, data centers, renewables), with a strong shift towards pre-engineered building solutions.

Interarch Building Solutions Limited reported a 25.5% revenue growth in 1QFY26, signaling robust performance. The management expressed confidence in exceeding its initial 17.5% growth guidance, driven by strategic capacity expansion and a burgeoning order pipeline. This analysis delves into the company's forward-looking commentary on sales, margins, and market opportunities.

Capacity & Growth Trajectory

Interarch is poised for significant growth, fueled by substantial capacity enhancements. The company's total production capacity is set to increase to 200,000 MTPA with the imminent commissioning of new PEB lines in Andhra Pradesh (Phase-II) and Kichha. Furthermore, a new heavy fabrication unit in Andhra Pradesh, expected by Q2 FY27, will add 24,000 tons to their heavy structure capability. Management noted,

“we are doubling our capacity in the three years.”

This expansion is backed by a planned CAPEX of approximately Rs.150 crores by March next year, aiming to generate Rs.1,300 crores in new building and heavy structure revenue capacity.

Market Momentum & Margin Outlook

The company's order book stands strong at Rs.1,695 crores, complemented by a robust pipeline of Rs.2,500 crores (Pipeline-I) and Rs.4,000 crores (Pipeline-II). Interarch is witnessing dramatic market momentum, with increasing demand from new-age industries like semiconductors, EV batteries, and data centers. Management stated,

“our position in the industry is improving.”

Despite competitive pressures, Interarch anticipates EBITDA margins to improve from Q3, targeting 50-100 basis points improvement, driven by operational efficiencies and selective order intake at better prices. Export opportunities in the US and Canada also promise higher margins.

Interarch Building Solutions is strategically expanding its capacity and diversifying its market reach, particularly into high-growth sectors and international markets. The company's focus on long-term client relationships and value-added offerings, rather than just price, positions it well. With strong order pipelines and expected margin improvements, Interarch appears set for continued robust performance and leadership in the pre-engineered building sector.

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